For the last 15 years I have been working with business owners to help them grow, adapt and succeed.
Having given advice to a vast number of private family businesses across a variety of industries, I have come to realise that most business owners simply just don’t know enough about their numbers, especially the critical ones.
No matter what stage of the business cycle you are at whether you’re a start-up, or a business experiencing rapid growth or even a business nearing exit, you need to take the time to review and listen to what your numbers are telling you.
While it may not be your most favourite function or activity, it is important to keep a close eye on the critical numbers that can help you predict the success of your business.
I understand that no one starts a business to become an accountant, so here are a few tips:
1. Start with a budget
This will force you to plan ahead and balance how much money you are bringing in versus how much money to are spending. It doesn’t have to be complicated or difficult to put together. There are a huge amount of free budgeting templates online to assist you.
2. Get a good accounting system
Make sure it’s online, automated and user friendly. Our firm recommends Xero and MYOB for most businesses. It’s cost effective and will give you the numbers you need.
3. Create the habit
With a small amount of initial discipline you can create a new habit that requires little effort to maintain. Set time aside on a regular basis similar to an external appointment with a client or supplier. Accountability is key.
4. Speak to your accountant
These are the people who love numbers. They will welcome hearing from you and will have the necessary skill set to arm you with ammunition you need to succeed.
Remember the point of knowing your numbers is to know your business on a more intimate level. This will lead you to making better decisions faster, enabling you to promptly act to any changing business environment and eventually, lead to you realizing the rewards of a highly successful business – your own definition of success.
Craig Hailston – Accountant, Business Advisor, SMSF Specialist